Correlation Between Axelum Resources and Converge Information
Can any of the company-specific risk be diversified away by investing in both Axelum Resources and Converge Information at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Axelum Resources and Converge Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axelum Resources Corp and Converge Information Communications, you can compare the effects of market volatilities on Axelum Resources and Converge Information and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Axelum Resources with a short position of Converge Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axelum Resources and Converge Information.
Diversification Opportunities for Axelum Resources and Converge Information
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Axelum and Converge is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Axelum Resources Corp and Converge Information Communica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Converge Information and Axelum Resources is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Axelum Resources Corp are associated (or correlated) with Converge Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Converge Information has no effect on the direction of Axelum Resources i.e., Axelum Resources and Converge Information go up and down completely randomly.
Pair Corralation between Axelum Resources and Converge Information
Assuming the 90 days trading horizon Axelum Resources Corp is expected to under-perform the Converge Information. In addition to that, Axelum Resources is 1.04 times more volatile than Converge Information Communications. It trades about -0.01 of its total potential returns per unit of risk. Converge Information Communications is currently generating about 0.01 per unit of volatility. If you would invest 1,583 in Converge Information Communications on August 30, 2024 and sell it today you would earn a total of 13.00 from holding Converge Information Communications or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.22% |
| Values | Daily Returns |
Axelum Resources Corp vs. Converge Information Communica
Performance |
| Timeline |
| Axelum Resources Corp |
| Converge Information |
Axelum Resources and Converge Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axelum Resources and Converge Information
The main advantage of trading using opposite Axelum Resources and Converge Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axelum Resources position performs unexpectedly, Converge Information can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Converge Information will offset losses from the drop in Converge Information's long position.| Axelum Resources vs. Swift Foods | Axelum Resources vs. Allhome Corp | Axelum Resources vs. Jollibee Foods Corp | Axelum Resources vs. LFM Properties Corp |
| Converge Information vs. Metro Retail Stores | Converge Information vs. Jollibee Foods Corp | Converge Information vs. Top Frontier Investment | Converge Information vs. Prime Media Holdings |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the CEOs Directory module to screen CEOs from public companies around the world.
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